Really interesting article on the rise and fall of Woolworth’s – the grandmother of American chain stores.
The author, reasonably, chalks up its demise to the great Suburban Migration following the Second World War and its inability to finesse its business model to adapt to the new circumstances:
By 2000, shortly after Woolworth boarded up its last stores, an outright majority of Americans were suburbanites. Firms like Woolworth had trouble adapting their cut-rate downtown model to the new suburban shopping centers that sprang up around the country. The company stuck to an updated version of the old five-and-ten even as postwar affluence brought a higher standard of living to many of its customers. So it couldn’t compete with new outlets designed for the shopping centers and malls, like Kmart, Target and Wal-Mart, all three of which came into being in 1962 and offered more household goods at bargain prices. By 1970 those “big-box” budget retailers, to be joined later by new discount franchises like Toys “R” Us, Circuit City, T. J. Maxx, Office Depot, and Best Buy, outsold traditional department stores as well as five-and-tens and rang a final death knell for the downtown business districts that Woolworth had long dominated.
A once seemingly invincible retail leviathan — that sounded the death knell for Mom & Pop stores long before Sam Walton took his first step — went toes up because they couldn’t adapt to the post-war box store tsunami.
What the author didn’t ask (and what he really should have asked) was whether there was any scenario under which WalMart might be similarly vulnerable?
We went from corner stores, to downtown chain stores, to suburban mega-stores and most people (judging by the anti-WalMart angst so prevalent in certain circles) seem to think we’ve reached the end of retail history.
But I think that web based shopping may threaten WalMart (and its clones) every bit as much as the rise of box stores threatened — and ultimately destroyed — the venerable old Five & Dimes of yesteryear.
At least I hope it does 🙂